Chapter 7: The End of the Road for Kazaa
Some five years after the first salvo against Kazaa was launched, a single judge of Australia’s Federal Court handed down a judgment that finally sounded its death knell. Universal Music Australia v Sharman License Holdings was decided in September 2005, less than three months after the Supreme Court finally reached a resolution in Grokster. Although the cases shared some startling similarities – involving virtually identical technologies and even some of the same parties – they were decided in very different ways. This decision highlights the breadth and flexibility of the Australian authorization doctrine, which allowed the court to impose liability without having to resort to the creation of a new doctrine. Kazaa’s secrets One of the challenges faced by the Sharman court was the need to unravel some of the technological and corporate tangles that obscured the case against the Kazaa technologies for so long. A complex corporate structure As chronicled in previous chapters, the ownership of the Kazaa technologies became ambiguous soon after the Amsterdam District Court’s 2001 decision to grant a preliminary injunction ordering Kazaa BV to shut them down. Within weeks, US-based businessman Kevin Bermeister had apparently told associate Nicola Hemming that original owner Kazaa BV was looking to sell its assets,1 and the FastTrack software was swiftly transferred to Joltid Ltd (“Joltid”), a Virgin Islands incorporated company that was controlled by one of the technologies’ original owners.2 In January 2002, Sharman Networks (“Sharman”) was incorporated in Vanuatu.3 The following month, a company called LEF Interactive was incorporated...
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